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what it is
Ulta sells makeup, skin care, fragrance, hair products, and salon services through 1,445 U.S. stores plus its app and website.
how it gets paid
Last year Ulta Beauty made $11.3B in revenue. cosmetics was the main engine at $4.0B, or 35% of sales.
why it's growing
Same quarter: comparable sales +6.3%; gross margin 40.4% of net sales (vs 39.7% prior-year quarter). Company raised fiscal 2025 outlook to about $12.3B net sales and $25.20–$25.50 diluted EPS (Dec 2025 release).
what just happened
Latest reported quarter EPS came in at $5.14 versus $4.47 expected, a 14.99% beat.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
45/100 earnings predictability — expect surprises
24.8x trailing p/e — priced about right
42.0% return on capital — every dollar works hard here
xvary composite: 75/100 — average
What they do
Ulta sells makeup, skin care, fragrance, hair products, and salon services through 1,445 U.S. stores plus its app and website.
Ulta wins because you can buy mass and prestige beauty in one trip across 29,000 products from more than 600 brands. That scale helps a lot. Return on capital was 42.0%, which means each dollar put into the business produced $0.42 in profit before financing choices. So what: this is a retailer with economics most retailers do not get.
How they make money
$11.3B
annual revenue · their business grew +0.8% last year
cosmetics
$4.0B
skin care
$2.5B
hair care
$2.0B
fragrance
$1.7B
salon services
$0.5B
other beauty categories
$0.6B
The products that matter
retail beauty merchandise
Merchandise Sales
$10.2B · ~90% of revenue
it's the center of gravity: cosmetics + skin care + hair care + fragrance from the segment table above sum to ~$10.2B of the $11.3B total—aligned with the bridge, not a rounded 85% slice that drifted from the rows.
~90% of revenue
salon and beauty services
Services & Other
$1.1B · 10% of revenue
this $1.1B segment is smaller, but it matters because it brings customers back into stores. repeat traffic is worth more than a one-time basket.
traffic driver
store execution and basket size
Comparable sales engine
4.4%–4.7% target
management raised comparable-store sales guidance to 4.4%–4.7% from 2.5%–3.5%. that range is the number the market is really underwriting.
the key metric
Key numbers
42.0%
return on capital
Return on capital → profit generated from money invested in the business → so what: Ulta is squeezing unusually high profit from a retail model.
24.8x
trailing p/e
P/E → price compared with past 12 months of earnings → so what: you are not buying this cheap.
16.0%
operating margin
Operating margin → profit after running the business but before interest and taxes → so what: Ulta keeps more of each sales dollar than many retailers.
~$12.3B
fiscal 2025 net sales outlook
Raised Dec 2025 company guidance (~$12.3B net sales; $25.20–$25.50 diluted EPS)—compare to the ~$11.3B segment bridge base, which is a different fiscal period label.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 55 / 100
- net profit margin 9.9% — keeps 10 cents of every dollar in revenue
- return on equity 42% — $0.42 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in ULTA 3 years ago → it's now worth $12,910.
The index would have given you $14,770.
source: institutional data · total return
What just happened
beat estimates
Q3 fiscal 2025: $5.14 diluted EPS vs consensus about $4.64 (~11% ahead).
Net sales $2.857B (+12.9% vs the prior-year quarter). Gross margin 40.4% of net sales (vs 39.7%). Comps +6.3%. Do not mash this quarter into the ~$11.3B segment table without checking the fiscal period.
$2.857B
net sales (q)
$5.14
eps
40.4%
gross margin
the number that mattered
The 14.99% EPS beat matters most because it shows demand held up better than expected in a business investors were bracing to see slow down.
-
ulta beauty delivered encouraging fiscal third-quarter results (period ended november 1st).the retailer reported earnings of $5.14 a share on net sales of $2.857 billion, ahead of a ~$4.64 consensus EPS and ahead on sales versus the same consensus tape. the outperformance was driven by better-than-anticipated momentum across all major product categories and channels, as u.s. consumers continued to prioritize wellness/beauty-related spending despite persistent macroeconomic pressures.
-
the outlook has once again improved.ulta has exceeded expectations in each of the last three quarters, with leadership upping its full-year forecasts on each occasion. the company now expects fiscal 2025 earnings of $25.20-$25.50 a share on sales of approximately $12.3 billion, versus its previous outlook of $23.85-$24.30 a share and $12.0 billion-$12.1 billion.
-
it also increased its comparable-store sales growth target to 4.4%-4.7%, from 2.5%-3.5%.
-
we are projecting double-digit earnings improvement in fiscal 2026.strategic growth initiatives implemented in 2025 are expected to be increasingly supportive of the bottom line next year. these include the acquisition of british luxury retailer space nk in july, which provided the company entry into the u.k. and irish markets, and the launch of its new ub marketplace in october, an invite-only online platform featuring over 100 brands.
-
all in all, we believe fiscal 2026 could be a payoff year for these investments.
Ulta Beauty Q3 fiscal 2025 results (Dec 4, 2025) · ulta.com investor release
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What could go wrong
the #1 risk is a comparable-sales slowdown after the recent guidance reset.
med
consumer beauty spending cools
Ulta sells discretionary product. If customers trade down or delay purchases, the pressure shows up first in baskets and traffic, not in a press release.
All $11.3B of revenue sits inside a consumer category that depends on shoppers showing up and spending.
med
tariffs, freight, or product cost inflation
The annual net margin is 9.2%. Last quarter it was 8.1%. This is a good retail margin, but it is not wide enough to ignore cost pressure.
If costs rise faster than pricing, the business has less room to protect earnings than a software company would.
med
the return-to-growth plan does not convert
The stock trades above the 3–5 year target midpoint of $569 while management is talking about double-digit earnings improvement in fiscal 2026. That's a high bar.
If growth stays closer to last year's 0.8% pace, the premium multiple has less support than the current price suggests.
You are buying a good operator, but the numbers say the market already expects better growth, steadier comps, and intact margins. Miss one of those, and the stock can re-rate lower.
source: institutional data · regulatory filings · risk analysis
Pay attention to
trend
whether growth finally moves above 0.8%
A $11.3B business can be slow and still be good. It cannot stay this slow forever if the stock keeps trading like a comeback story.
metric
comparable-store sales against the 4.4%–4.7% target
This is the operating number that connects directly to the rerating case. If comps slip back, optimism slips with them.
risk
margin drift from 9.2% annual and 8.1% quarterly levels
Ulta does not need perfect margins. It does need them to stay healthy enough that earnings can still outgrow sales.
calendar
whether fiscal 2026 becomes the payoff year management is signaling
The setup is clear: three beats, higher comp guidance, and investment carryover into next year. Now you need the payoff, not the promise.
Analyst rankings
short-term outlook
top 5%
momentum score 1 — analysts expect above-average price performance near term. in human-speak, they think the setup still has legs.
risk profile
average
stability score 3 — this is not a bunker stock, but it is not a chaos stock either.
chart momentum
average
technical score 3 — the chart is behaving normally. No screaming signal, just a stock in motion.
earnings predictability
45 / 100
Forecasting these quarters is harder than it looks. You should expect some estimate misses, guide shifts, or both.
source: institutional data
Institutional activity
institutions have been net buying for 2 consecutive quarters — 482 buyers vs. 470 sellers in 3q2025. total institutional holdings: 42.7M shares. net buying for 2 quarters.
source: institutional data
Price targets
3-5 year target range
$349
$788
$631
current price
$569
target midpoint · 10% from current · 3-5yr high: $845 (+35% · 8% ann'l return)
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